Does a new car cost more to insure than an older or used car? Some people think that insuring a new car is so cost prohibitive, they will avoid purchasing one altogether. Before you sacrifice your dream of owning something fresh off the lot, you should understand how auto insurance works with new cars.
It's Not Because the Car Is New
It doesn't matter how new the car is. Buying a current-year model will not raise your insurance premiums. What really matters to auto insurance companies is
- the desirability of the car
- and the riskiness of the car.
These two things can affect cars of various makes, models, and years. They don't just apply to new vehicles.
Who Wants Your Car?
How desirable is your car to thieves? You may have never considered that thieves, especially career car thieves, have certain makes and models that they tend to look for. It doesn't matter if your car is a new one or an old one.
If there's a lot of reported thefts for your particular make and model, you may have higher insurance costs. Don't make assumptions about the types of cars a thief may want. Consider that from the year 2003, all the way up to 2012, the most stolen cars in America were '90s coupes and sedans.
How Risky Is Your Car?
Insurance companies must factor in the risks that come with owning and driving a car. Some vehicles are inherently more risky than others. It has nothing to do with whether your car is brand-new or not. It has to do with whether the car
- was specifically built for speed,
- was specifically built for sport,
- or lacks adequate safety features.
The more risk a car represents, the higher the insurance costs. So, if your new car is the sports model, you may see some higher-priced quotes. If you pick up the base model that lacks security and safety features, you will have to pay extra in insurance.
You Still Have Options
Now that you know your new car doesn't necessarily come with a higher premium, you can make a more informed decision. However, even if you have your heart set on a brand-new sports model, you still have options. You can still
- look for car insurance discounts,
- check multiple quotes,
- and add additional security and safety features.
Different insurance companies use different criteria for insurance rates. These considerations go beyond the desirability and riskiness associated with your new vehicle. They will also factor in your age and driving record. You can still find the best auto insurance policy for your new car just by shopping around and speaking to agents at car insurance companies. Contact an insurance agency like Northeast Insurance Agency for more information.